The state-appointed receiver who took over governing Central Falls, R.I., has appointed a “state receiver’s council” to take over from the elected City Council, state officials announced Tuesday.

“We were notified that we were no longer necessary,” City Council President William Benson Jr. said in an interview. Benson said he and other City Council members were informed on Monday that they had been relieved of their duties in a letter from the receiver, former Judge Mark Pfeiffer, and only learned of the unelected council from the media.

“How is it a judge can just bring outsiders in?” Benson asked. “He’s disenfranchised every voter in the city.”

Pfeiffer said in a news release that he took the action because the City Council had refused to comply with his policies and procedures.

“I was hopeful the City Council would recognize that it was in the best interest of the residents of Central Falls to work together,” Pfeiffer said. “It is unfortunate that several members of the City Council have chosen to continually obstruct our efforts to return fiscal stability to the city.”

Last month, a state judge upheld the constitutionality of the law that allowed the state to appoint a receiver to take over the finances of troubled Central Falls. The mayor and a majority of the City Council argued that the receiver had effectively removed them from office without due process. Superior Court Judge Michael Silverstein rejected those claims, agreeing with the state that though the law gave the receiver the same powers as elected officials, it was envisioned as a temporary arrangement.

Benson said he would consult with his attorney about legal options.

Pfeiffer announced that the receiver’s council would be composed of current City Council member James Diossa, former City Council member Robert Ferri, and former Central Falls finance director Edna Poulin. The appointed council will perform the functions of the elected council, including licensing, permitting and zoning.

Central Falls went into judicial receivership in May after projecting a $3 million shortfall in its nearly $18 million fiscal 2010 budget, along with a $5 million budget gap for fiscal 2011. The city’s debt was subsequently downgraded to junk by Standard & Poor’s and Moody’s Investors Service.

Those developments prompted Rhode Island legislators to enact a law that prevents municipalities from going into receivership on their own and establishes a system for state intervention in fiscally distressed cities and towns.

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